Politics is about persuading voters about priorities.
To do so, facts are important, but they can also be misused in an attempt to win the debate.
Here the facts fight back. This site presents the facts to help keep the debate clean and to persuade politicians and others to stick to the facts.

The answer that the board came to was no amount of tobacco can be non-harmful, whereas it doesn’t believe that every amount of oil is harmful or every amount of gas is harmful or every amount of coal is harmful.

Fossil fuels are knownto causeharm to health, economies and ecosystems both through local pollution and through climate change.

The total climate damage per tonne of CO2 emitted is called the ‘social cost of carbon’ (SCC). The US Environmental Protection Agency (EPA) calculates the social cost of carbon will be an average $39 (in $US2011) per tonne of CO2 emitted in 2015. This equates to roughly $48 current Australian dollars. Emissions in later years will cause even more damage as climate impacts increase.

While the EPA offers figures for ‘average damages’ calculated in its models, it clearly specifies that damages could be much higher. In fact, the agency suggests there is a one-in-twenty chance that the social cost of carbon could be three times higher than the average figures presented.

In economic terms, the social cost of carbon is the fair and ‘efficient’ level for a carbon price to make the polluter pay for the damage done through climate change (not including local impacts).

While there is a growing number of carbon pricing schemes around the world, most carbon prices remain lower than the EPA’s SCC figures. In 2013-14, Australia’s carbon price reached $24.1/tCO2.

A US court recently ruled against a coal mine on the grounds the mine proponents had incorrectly argued that uncertainty around the SCC meant they could ignore the mine’s climate impacts.

One factor in calculating the SCC is choice of ‘discount rate’, which represents how much we value the wellbeing of future people, including ourselves. The US EPA uses a 3 per cent discount rate, but also provides SCCs discounting at 2.5 per cent and 5 per cent per year. These are high discount rates compared with other analyses, such as in the Garnaut Review and the Stern Review. Using a higher discount rate means the calculation is less concerned about future damage. Using lower discount rates, to reflect greater concern about the future, would further increase the SCC.

Global climate negotiations have not been based on pricing carbon. Rather, governments around the world have agreed to act to limit global warming to 2 degrees average warming. This commitment sets an implicit threshold for ‘safe use’. However it is important to recognise that even emissions under this threshold would cause damage, as indeed they already are.

If the Future Fund wants to argue there is a safe level of fossil fuel use, it should create a policy outlining what it thinks that safe level is. Its policy should take account of the social cost of carbon, arguments about a carbon budget, as well as local impacts from fossil fuels. The Future Fund should then take steps to mitigate what it determines to be harmful investments in fossil fuels.

4 Responses

peterNovember 26, 2014 at 12:51 am ·

Over half of Australian coal exports are used in steel production. So unless you have found another way to allow the developing world to build the infrastructure that will lift them out of poverty I think you are only telling half the story.

Tom SwannNovember 26, 2014 at 9:25 pm ·

Peter

There are alternatives to met coal. Large volumes (from memory around a quarter) of current global steel production is recycled – this process uses electricity, which as we know can be renewable. There are also ways to use less met coal and then to use less steel in building infrastructure. You’re right it’s a challenge, but it’s surmountable, and necessary to overcome because of the damage it’s causing, especially to the global poor.

peterNovember 30, 2014 at 9:49 pm ·

The problem is that recycling doesn’t increase the amount of steel that exists and any alternative building methods or steel manufacturing methods just increase cost to the developing world.

I’m of the opinion that we’ve already used up our safe quota of GHGs (plus more). There is no safe level any more. Even 2C is not a safe temperature increase, rather a political compromise on the boundary between dangerous and potentially catastrophic.

Even the carbon budget itself is calculated with an implied ‘risk appetite’ that has so far only been suggested, not ratified to my knowledge.

Why

Between elections governments are held to account through debate. This debate takes place in the parliament, media, in workplaces, at BBQs and parties, around the kitchen table and online.Politicians, pundits and interest groups attempt to influence the debate and persuade us which side of the debate to take.

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Should the Australian government encourage renewable forms of energy or do we need to support fossil fuels? Is returning the budget back to surplus the number one priority and if so should be decrease spending or increase revenue? Should we focus on industrial relations or indigenous recognition?

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There are, of course, no right answers to such questions. But to use the complexity of a policy issue to cloud debate with half-truths and misrepresentation of the facts to win the debate undermines the democratic accountability of government.

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The media plays an important role in presenting an even handed account of the debate and ensuring a range of voices are heard. In turn politicians are keen to influence the debate through the media's reporting. Undue influence risks silencing some voices from the debate.
As the political debates continue Facts Fight Back will provide a timely and accessible source of information to help keep the debate clean and and ensure the public, journalists and the politicians themselves keep track of who is sticking to the facts.